M a r k e t N e w s

Tanzania to Experience Strong Economic Growth in 2022 and 2023, AfDB Projects

Posted on : Friday , 19th November 2021

The African Development Bank (AfDB) has recently released its East Africa Economic Outlook 2021 report, estimating that Tanzania’s GDP will grow by 2.8 per cent in year 2021, and projecting a strong rebound for year 2022 and 2023 with 4.9 per cent and 6.3 per cent economic growth respectively.


The report reviews the economic performance of the 13 countries under the AfDB’s East Africa Regional Development and Business Delivery Office: Tanzania, Kenya, Ethiopia, Rwanda, Djibouti, Burundi, Comoros, Eritrea, Seychelles, Somalia, South Sudan, Sudan and Uganda.


All in All, East Africa is the only region in Africa that avoided a recession in 2020, thanks to better performance in agriculture, sustained public spending on large infrastructure projects, and increased regional economic integration.


In many countries like Tanzania, Kenya, Ethiopia and Djibouti— construction, supported by an acceleration in public investments (particularly in large infrastructure projects), drove growth on the supply side.


But political fragility in some countries and limited economic diversification in others were major impediments to growth.


East Africa’s GDP growth is projected to recover to 3.0 per cent in year 2021 from 0.7 per cent in year 2020, supported by the global economic recovery.


East Africa is also experiencing a progressive change in the composition of GDP, from predominantly agriculture to services.


But the transition to higher value-added economic activities—which signals structural transformation—has been slow.


In year 2022, the top performers are projected to be Rwanda with projected GDP growth of 6.9 per cent Kenya and Djibouti (6.4%), and Tanzania (4.9%).


And in year 2023, Tanzania is projected to be the top performer in East Africa, after Rwanda (8.1%), with a GDP growth of 6.3 per cent


The Economy of Tanzania in 2022


In April 2021, Tanzania’s new president Samia Suluhu Hassan gave her 1st speech to the parliament, mentioning the priorities of the 6th Phase Government in the next 5 years to reach a GDP growth rate of at least 8 per cent yearly.


However, the IMF projects a GDP growth for Tanzania of +5.1 per cent in year 2022, and 6.0 per cent in 2026.


Source : www.abafnz.com
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